Learn more about the housing market in Washington

Every state is unique when it comes to the real estate market. That’s why it’s critical to understand the market you live or operate in. In the case of Washington State, the picture in 2025 is one of moderation: the average home value hovers around $595,738, reflecting a slight year-over-year decline of 0.3%. While the market isn’t freefalling, it’s obvious that the rapid price surges of previous years are giving way to more measured movement as buyers adapt, inventory climbs, and affordability remains a lingering challenge.

Washington State Housing Market Overview

Located in the Pacific Northwest, Washington is a state known primarily for its vast mountain ranges that cover a considerable portion of its land. Sharing a border with Canada, it sits in the northwest corner of the continental United States. Washington thrives on a number of different industries, but data from IBISWorld suggests that Real Estate, Rental, and Leasing was the second-highest contributing sector to the state’s 2024 GDP, behind only Information. This suggests a notable housing market in the state that is worth looking further into.

At the start of 2025, experts anticipated a steadier yet still competitive housing market in Washington, with gradual home price growth and a modest decline in mortgage rates. So far, these expectations have largely played out. As of early 2025, the median home price in Washington is around $662,800, up 1.3% year-over-year, while the average 30-year fixed mortgage rate has eased slightly to 6.67%.These metrics reflect a housing market that continues to favor sellers, but with growing supply and stabilizing rates suggesting a gradual shift toward balance looking forward to 2026.

In fact, historically high interest rates have seen a significant decrease across the country, signaling a more stable lending environment heading into 2026. The national average 30-year fixed mortgage rate sits at 6.17%, down 0.55% from late 2024, and is the lowest level we've seen in the past year. A similar pattern can be seen in Washington’s housing market, where easing rates and growing inventory are expected to help gradually improve affordability for prospective buyers over the next year.

Washington Market Trends 

To understand the Washington real estate market, it’s important to keep up with trends. Let’s take a look at some key ones in Washington:

Note: These statistics are based on Redfin’s monthly housing data from September 2025.

Median Home Price

The median price of a home in Washington in September 2025 was $630,700, according to Redfin’s monthly housing market data. This is a slight decrease of 0.62% from 2024. In Seattle, the most populous city in the state by a significant margin, the median housing price is significantly higher at $853,000 in September 2025, but is still down 2.6% compared to last year. It is important to remember that in any state, statewide data is pulling from a plethora of housing markets experiencing a variety of different influences and factors.

Number of Homes Sold in September 2025

7,943 homes were sold in Washington in September 2025, which is a 3.1% increase from September 2024. This number can be expected to decrease in the winter months, and climb again closer to the summer. It is important to keep in mind that nationally speaking, sales usually peak during the spring and summer months and slow in the winter. In fact, the National Association of Realtors (NAR) predicts that in February and March alone, sales activity increases by as much as 34% and prices by 3%.

Despite this, number of home sales from the previous three years have failed to reach the same peaks that were recorded in the summers of 2020 and 2021.

Median Days on Market (DOM)

Days on market (DOM) is a measure of the average length of time a home remains listed on the market before being put under contract. A lower DOM signals a highly competitive seller’s market with more pressure on buyers to make higher offers and remove contingencies. A higher DOM signals a buyer's market as sales are slower and sellers have less leverage.

The median DOM in Washington in September 2025 was 35 days, up 8 year over year. This means that, on average, homes are spending just over a month on the market before going under contract, a slight slowdown from the rapid turnover seen in previous years. While a rising DOM suggests the market is becoming slightly less competitive, Washington’s overall pace of sales remains healthy, especially in high-demand areas like Seattle and North Creek.

New Supply Statistics

In August 2025, Washington authorized roughly 2,734 new private housing units, according to the U.S. Census Bureau. This steady pace of new construction highlights ongoing efforts to expand the state’s housing supply, which continues to outperform many regional markets. As more projects reach completion through late 2025 and into 2026, this growing inventory is expected to help moderate home-price growth and improve affordability across several Washington metros.

Property Tax Rate

According to Rocket Mortgage, the average property tax rate in Washington is 0.84%. This is very close to the nationwide median, and Washington state is ranked 24th nationwide. The average annual property tax in the state is $3,193.47. As previously mentioned, it is important to keep in mind that this statistic reflects the average of a lot of data with significant geographic and economic diversity. Tax rates are likely to vary depending on the value of a home and its location in the state.

Foreclosure Rate in 2025

In September 2025, about 1 in every 6,274 homes in Washington experienced a foreclosure filing, according to ATTOM. This marks a 67.7% increase year-over-year, though Washington still ranks 28th nationwide, indicating that the state continues to maintain relatively low foreclosure activity compared to much of the country.

Hottest Local Markets in Washington State

1. Seattle

Seattle remains one of Washington’s most competitive housing markets, though prices have softened slightly in 2025. The median listing home price in September 2025 was $790,000, down 1.1% year over year, with a median sold price of $850,000. Homes spent a median of 39 days on the market, and with a sale-to-list price ratio of 99.3%, Seattle continues to favor sellers. The city currently has over 3,100 homes for sale across 94 neighborhoods, with Broadway, Belltown, and Wallingford standing out as some of the most desirable areas.

2. Spokane 

Spokane, the second most populous city in Washington, has seen slight cooling in its housing market in 2025. As of September 2025, the median listing home price was $445,000, down 1.1% year over year, with a median sold price of $420,000. The sale-to-list price ratio of 99.4% shows that most homes continue to sell close to asking price, reflecting steady buyer demand despite rising inventory. Spokane offers 1,900+ homes for sale across 28 neighborhoods, with Lincoln Heights, East Central, and West Central ranking among the city’s most desirable areas.

3. Vancouver

Vancouver remains one of Washington’s most active housing markets, though prices have softened slightly in 2025. The median listing home price was $550,000, down about 1.8% year over year, while the median sold price hovered around $490,000. Homes spent a median of 48 days on the market, suggesting a slower pace than in 2024 but still steady demand. With a near-100% sale-to-list price ratio, Vancouver’s market is edging toward balance, offering more breathing room for buyers. Popular neighborhoods like North Image, Cascade Park East, and Rose Village continue to attract interest for their affordability and proximity to Portland.

Economic Factors Impacting the Washington Housing Market

A holistic view of Washington’s housing market requires a basic understanding of the main economic drivers affecting the market. Let’s take a look at a few below.

Mortgage Rates 

Mortgage rates are a common cause of concern for would-be homeowners across the U.S. in 2025. According to Zillow, In Washington, the average 30-year fixed rate has fallen to about 5.99% as of November 2025. This decline reflects easing inflation and suggests that borrowing costs may continue to moderate as we move into 2026.

Inflation and Cost of Living

Mortgage rates are tied to inflation, another massive contributing factor to the affordability of housing and the state of housing markets in general. Inflation has increased the cost of living for many across the U.S., including in Washington. This means fewer people can truly afford to limit housing costs to less than 30% of their monthly income.

Population Changes and Demographics

A changing population ca also have implications for the housing market. According to the U.S. Bureau of Labor Statistics, the unemployment rate in Washington State was at 4.5% in August of 2025. This is one of the highest rates in the country. However, unemployment rates all around the country are down, suggesting economies that are thriving and bound to bring more potential homeowners to the state.

Washington Housing Market Forecast 2026

Experts anticipate that Washington’s housing market will continue to experience moderate price growth heading into 2026, though at a slower pace than in previous years. After many years of sharp appreciation, cooling inflation, easing mortgage rates, and a gradual increase in housing supply have begun to place upward pressure on prices. While demand remains strong, the data suggests that price growth in 2026 is likely to be steady rather than steep, and conditions should be more balanced for buyers and sellers.

Likelihood of Washington Housing Market Crash

Though continually rising housing prices in Washington may seem concerning, experts have maintained that a crash is significantly unlikely. There are many reasons for this, including a healthy economy signified by low nationwide unemployment rates and the decline and stabilizing of interest rates. The market seems poised to continue appreciating, but it is unlikely to reach any significant or concerning threshold in the near future.

Forecast for the U.S. Housing Market

Now that we’ve looked at Washington’s housing market, let’s zoom out a little bit. What about the U.S. housing market? What do you need to keep an eye on in the coming years?  

The United States' current median existing-home sale price is around $415,200 per the National Association of Realtors. The inventory, though, remains low. A balanced market typically has a 5-to-6-month supply, but the current figure is 3 months, keeping conditions constrained.

We’re currently in a seller’s market with buyers looking at continued rising house prices—although they are rising at a slower pace compared to previous years.. The same trend can be seen with renters. Housing continues to appreciate, in general.

Dr. Lawrence Yun, Chief Economist and Senior Vice President of Research, National Association of Realtors, believes the housing market will appreciate 15 to 25% over the next five years. He thinks that the seller’s market will continue because housing inventory will remain low. In 2026, he predicts that existing home sales will rise an additional 13%. Yun expects mortgage rates to stabilize at the lower end of the current 6-7% range through 2025 and 2026 as the Federal Reserve continues gradual rate cuts. There's an anticipation of a more balanced market in the coming years, with moderate price growth and a greater amount of Americans re-entering the market.

Hybrid work also impacts the housing market. This shift in work culture means suburbia will continue to grow. States like Texas, the Carolinas, Tennessee, and Florida should see continual growth.

The number of single-family homes built decreased over the past couple years while the number of multi-family homes increased due to lower prices and a demand for affordable housing. Year-to-date single-family housing starts were down about 7.1% in 2025, whereas starts for buildings with five or more units were up roughly 14.5% Higher mortgage rates and inflation (affecting price of materials) were the main causes.

Lower income households continue to struggle in the current housing market. This trend appears likely to continue into the foreseeable future. According to the National Association of Home Builders, approximately 74.9% of U.S. households were unable to afford a newly built median-priced home in 2025. Without enhanced supply or helpful subsidies, the outlook is that many Americans will still wrestle with housing affordability in the years to come.

Washington Rental Market

The rental and buying market are obviously closely linked. When home prices fall, landlords are more likely to buy properties to rent out. Home prices and rental prices are correlated as well because a hot market means prices rise.

Rents were more unaffordable than ever in 2021 and 2022. In 2022, 22.4 million households paying rent said it was unaffordable, which is the highest that figure has ever been, according to a January report from the Joint Center for Housing Studies at Harvard University. The study found that half of all renters in the United States spent over 30% of their income on rent and utilities.

The markets cooled in 2023 and 2024, though, due to new units and decelerating demand. But a serious problem persists: Rent increases are still outpacing income gains. In 2025, rent growth continues to outpace income growth, particularly in high-cost metros like Seattle. According to Zillow’s 2025 rental data, national rent growth has slowed to about 3–4% year-over-year, but Washington’s major metro areas—like Seattle which is 9% above the national average—still exceed national averages in both asking rents and price-per-square-foot.

Moreover, high interest rates are keeping borrowing and transaction activity down. Over half the banks surveyed by the Federal Reserve reported that demand for multifamily loans decreased year-over-year.

The pandemic caused a housing disparity that isn’t going away anytime soon. Unaffordable housing is a serious issue across America. Whether high rents or low income is the main cause doesn’t change the fact that this problem is widespread.

Looking ahead to 2026, rental conditions in Washington are expected to remain tight. According to the Urban Land Institute (ULI), annual rent growth across the U.S., including high-demand regions like the Pacific Northwest, is projected at around 4.3% in 2026, reflecting persistent demand and constrained supply.

This short summary leads directly into Washington’s current rental market. Below are just a few of the current trends for Washington’s rental market based on data pulled from Zillow:

Washington Rental Market Key Trends

• Median rent: $2,135

• Month-over-month rent change: -$55

• Year-over-year rent change: +$35

• Available rentals: 17,461

Conclusion

As we have covered throughout this article, any state’s housing market is bound to be made up of diverse influences, factors and variables, and summative data cannot tell the whole story. However, as a whole, Washington’s housing market in 2025 shows signs of steadying, with moderating mortgage rates, rising inventory, and slower but positive price growth. Buyers and sellers should continue watching key indicators such as interest rates, new construction, and shifting demand as the market heads toward 2026.

FAQs

Is the Washington housing market expected to cool down in 2026?

Yes. Analysts expect the market to moderate as mortgage rates ease and inventory expands, though prices will likely continue rising at a slower pace rather than falling.

Are home prices in Washington still increasing in 2025?

Home prices are still rising but at a more gradual rate compared to the rapid increases of 2020–2022. Many markets remain competitive, especially in Seattle and surrounding metros.

Is Washington currently a buyer’s or seller’s market?

Most of Washington remains a seller’s market in 2025 due to limited supply and steady demand, though some areas are moving toward a more balanced market.

What are the main factors influencing Washington’s housing costs?

Key drivers include mortgage rates, inflation, construction costs, population growth, and limited housing supply, especially in high-demand regions.

How are mortgage rates impacting buyers in Washington?

Mortgage rates have eased slightly in 2025, improving borrowing conditions, but they remain higher than pre-pandemic levels—still limiting affordability for many buyers.

Are more homes being built in Washington in 2025?

Yes. New construction has increased, helping expand inventory, though supply remains below what’s needed to meet long-term demand.

Will the Washington housing market crash?

A crash is unlikely. Strong demand, low inventory, stable job growth, and easing mortgage rates point toward continued stability rather than a major downturn.